New Home purchase FAQs
Q. With the national housing market declining, how is the Austin market doing?
A. Great! - Here is an article from The Austin Business Journal on Sept 26, 2006:
MEANWHILE AUSTIN SALES CONTINUE CLIMB
AUSTIN (Austin Business Journal) – More than 2,800 homes sold in the Austin area in August, a 6 percent increase over the same time last year. The median home price increased 8 percent, to $182,500.
According to the Austin Board of Realtors (ABoR) Multiple Listing Service (MLS), sales brought in more than $683 million, an increase of 19 percent. At 60 days, the average days-on-market was 10 percent less time than in August 2005. Active single-family listings dropped by 2 percent to 8,137. "The Austin market continues to buck the national trend because this city is really in the infancy of its life as a major metropolis," says John Rosshirt, the board's chairman.
Q. We've driven around new subdivisions and seen these beautiful new homes, but we don't make that much money. Plus I have no money saved for down payment. We wouldn't qualify for one of those would we?
A. Yes, very possibly. With some of the lowest interest rates in history, the largest builder incentives ever and new, more creative mortgage loans, Austin New Home ownership is more affordable than it's ever been.
Q. Is this a good time to buy a new home? Is it a good investment?
A. Absolutely. For one of the few times in history, you can live in and enjoy a New Home in Austin, Round Rock, or Cedar Park for often the same or less monthly payment as a rental house or apartment. New Homes in Austin are considered to be one of the best investments around.
Excerpts from article in business section of the Austin-American Statesman
Sunday, January 23, 2005
Investors looking to diversify their portfolios are flocking to Texas by the busload from California and other states for what some say is one of the hottest investment opportunities around.
"If builders would give us 20 homes a month, investors would take them all," said. one Realtor.
Lured by huge builder incentives, lower interest rates and a large inventory of spec homes and convinced that the Austin area economy is turning around, investors are snatching up new homes priced from $90,000 to the high $100,000s in subdivisions in Austin's suburbs, some putting the 20 percent minimum down and others paying cash. One builder estimated that investors are buying at least 100 homes a month in the Austin area.
"They're putting their tea leaves here," said a representative of the area's largest home builder. "They see opportunity." It is an opportunity created by Austin's building boom, and one that may not be around for long.
"Investors recognize there is something wrong, and there's an opportunity to make money," said Jack Harris, a research economist for Real Estate Center at Texas A&M University.
"They're getting in at the bottom."
Q. What if I have bad credit? Can I still purchase a new home?
A. Possibly. Depending on how damaged your credit is, you can many times get an "B" or "C" loan (at a higher interest rate than the going rate). The higher the rate, the higher your monthly payments will be and the less affordable for you.
We can suggest or refer you to a mortgage loan professionals that specialize in helping first time and special needs buyers. They will "pre-qualify" you for a mortgage loan. Based on your income (and credit score - which will determine if you qualify for a "B" or "C" loan) they will be able to tell you exactly what payment you can qualify for.
If it turns out you can obtain a mortgage at a reasonable monthly payment -Great - We can go house hunting to find you your dream home! If it's not feasible to qualify at this time, the mortgage broker can assist you with Credit Repair and Building so you can buy a home at the earliest possible time in the future.
In the meantime, we will advise and work with you to educate you to the market and homeownership issues until the time comes to buy.
If you need transitional apartment housing in the meantime, we can assist you in finding the best ones that will work with you on the sensitive timing of moving to a new home.
NEW HOMES SALES HIT RECORD HIGH,
4th CONSECUTIVE YEAR
WASHINGTON, D C (nahb.org)
2004 sales of builder new single-family homes topped one million and set a new annual sales record for the 4th consecutive year, according to the most current United States Commerce Department numbers. The chief economist for the National Association of Home Builders (NAHB), says the organization expects the total in 2005 to be slightly smaller.
NAHB President Dave Wilson said sales were up nearly 9 percent for the year and topped one million for the 2nd consecutive year The record setting sales can be attributed to strong demographic demand, low mortgage interest rates, rising employment and income, and they expect this pattern to continue into early 2005.
Total new single-family home sales for 2004 reached over 1.18 million, an almost 9% increase from the previous annual record of 1.08 million set in 2003. The pace of builder home sales for December, 2004 reached a seasonally adjusted annual rate of 1.1 million homes, up a slight 0.1 percent from November's pace of 1.09 million houses.
